High-End Hotels Shouldn’t Fear Airbnb Says Wall Street Exec

Julie Verhage, Bloomberg

- May 04, 2016 11:00 pm

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Brands that don’t distinguish between demographics, travelers’ mindset, and destinations may have something to worry about. But even though budget is a consideration of Airbnb users, typical budget travelers have shown no strong interest in the Airbnb product.

— Jason Clampet

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In his bullish call on Hyatt Hotels Corp., John Khoury of Long Pond Capital LP said the high-end leisure market shouldn’t worry about Airbnb Inc. The budget hotel market, however, may be in for a rough ride.

Speaking at the Sohn Investment Conference in New York, Khoury touted Hyatt, saying shares have more than a 60 percent upside despite lodging being the most “out of favor” piece of the real estate sector. One of the reasons he cited for his optimism is that, unlike leisure travel, Airbnb and its online community of accommodations is unlikely to damage the industry’s revenue stream from business and high-end travelers.

A number of Wall Street firms recently pointed to this trend. A note from Cowen & Co. last month showed that hotels have a clear advantage among business travelers. The survey also revealed that respondents who used Airbnb were more likely to use hotels for business travel.

Goldman Sachs Group Inc. also conducted a survey earlier this year that showed while people do typically stick with Airbnb after using it [Editor’s note: “Stickiness” is still stronger at hotels], the peer-to-peer travel market still has low penetration among business travelers.